Sun, Jun 14, 2009 page11

• Airline industry moves to reduce costs

  • AP AND AFP
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  Citing exceptionally poor market conditions, Irish airline Aer Lingus said on Friday it was cutting back trans-Atlantic flights on its winter season later this year.

  The former state airline said in April that total revenues fell by 16 percent year-on-year in the first three months of this year and warned it was facing an exceptionally tough trading environment.

  “Aer Lingus’ yields have been declining in exceptionally poor market conditions,” a statement from the carrier said. “Most notably, long haul average fares fell by 19 percent in the first quarter of 2009 reflecting weak economic conditions and consumer confidence on both sides of the Atlantic.

  “As a first step in right-sizing the business, Aer Lingus will be reducing seat capacity on winter long haul services — by approximately 25 percent as compared to 2008,” it said.

  Aer Lingus chairman Colm Barrington said the airline was going through its most difficult period in its 73-year history.

  “We are looking at the whole operation of Aer Lingus and we are starting off with the winter schedule,” he said.

  He said services between Dublin and Washington and San ­Francisco would be suspended.

  Flights between Chicago and Shannon airport in western Ireland will also be suspended.

  The moves come as the International Air Transport Association nearly doubled its forecast for global airline industry losses this year to US$9 billion reflecting a “rapidly deteriorating revenue environment” because of the worldwide economic downturn.

  CESSNA

  Separately, embattled US corporate jet builder Cessna Aircraft said on Friday it plans to cut an additional 1,300 jobs to adjust production to match a meltdown in orders amid the global economic downturn.

  The new job cuts will bring the total number of payrolls eliminated since November to 8,200, about half the prior workforce, said the company, a wholly owned subsidiary of Textron Inc.

  “We had previously reduced the workforce by 6,900 since November, until April 29. This will be 1,300 on top of that,” Cessna spokesman Doug Oliver said.

  Oliver said the jobs were based “solely” on a reduction in aircraft production.

  “We are delivering fewer aircraft than we originally planned,” he said.

  A year ago the company had projected 535 aircraft deliveries this year, a number that has since been revised to between 270 and 300 “because of the economic crisis,” he said.

  Oliver said 800 employees would receive pink slips over the next two weeks, with the remainder notified in August.

  As part of the restructuring, the Wichita, Kansas-based company will close a plant in Bend, Oregon.

  US AIRWAYS

  Meanwhile, US Airways Group Inc is asking 400 flight attendants to take up to 16 months off in response to overstaffing.

  The Tempe, Arizona-based company is seeking 300 volunteers from its hubs in Phoenix and Las Vegas and 100 volunteers based on the east coast.

  US Airways spokeswoman Valerie Wunder said on Friday that the airline has cut flights faster than flight attendants have left through normal attrition.

  Wunder says the airline would turn to involuntary furloughs if it doesn’t get enough volunteers.

  Airline president Scott Kirby said at an industry conference on Thursday that the company’s current decline in passenger revenue is even worse than the decline that followed the terrorist attacks of Sept. 11, 2001.
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